The Ministry of Commerce of China said on Thursday that it will work with the central bank and the entire government to manage exchange rate fluctuations throughout 2024, should the yuan begin to recover against the dollar and make already weak Chinese exports more expensive.
Manufacturers in the world's second-largest economy have struggled to find buyers at home and abroad for much of this year. Although exports grew for the first time in six months in November, analysts warned that factory owners were being helped by a weak yuan and likely offering unsustainable discounts to find buyers.
We will collaborate with the People's Bank of China. After all, we will also work with the State Administration of Foreign Exchange and other departments. Our goal is to effectively deal with the risk of exchange rate fluctuations,” said Shu Jueting, spokesperson for the Ministry of Commerce.
“We will support companies through hedging and cross-border renminbi settlement,” he added.
Thus, global investment banks predict a continued decline in the yuan in the first half of 2024. They believe that the Federal Reserve will reduce rates in the US, influencing the subsequent recovery of the Chinese currency.
Source: Joe Cash and Ella Cao | Notícias Agrícolas
